Obama sees progress on TPP (Dems don't) — Dodd-Frank being weakened? — How John Henry built the Red Sox

OBAMA SEES PROGRESS ON TPP — President Obama, at a joint presser today in Tokyo with Japanese Prime Minister Shinzo Abe: “We made important progress in the Trans Pacific Partnership, TPP, which will support good jobs and growth in the United States as well as economic reform and revitalization here in Japan. We’re closer to agreement on issues like automobiles and agriculture.

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“I’ve been very clear and honest that American manufacturers and farmers need to have meaningful access to markets that are included under TPP including here in Japan. That’s what will make it a good deal for America, for our workers, our consumers and our families. That’s my bottom line and I can’t accept anything less.”

MORE ON THE PRESSER FROM POLITICO’s hardworking Jennifer Epstein who notes that Obama said regarding Democratic opposition to TPP: “Sometimes [we] have to push our constituencies beyond their current comfort levels” http://politi.co/1gSCkDK

TOP TWEET — Rep. John Dingell (D-Mich.), during the presser: “TPP remains a bad deal until Japan addresses currency manipulation & fairly opens markets to US goods. No more excuses.”

OBAMA TRIES TO REASSURE ASIA — Reuters’ Linda Sieg and Matt Spetalnick: “Obama used a state visit to Japan on Thursday to try to reassure Asian allies of his commitment to ramping up U.S. engagement in the region, despite Chinese complaints that his real aim is to contain Beijing's rise. Obama is being treated to a display of pomp and ceremony meant to show that the U.S.-Japan alliance, the main pillar of America's security strategy in Asia, remains solid at a time of rising tensions over growing Chinese assertiveness and North Korean nuclear threats. …

“Behind the scenes, U.S. and Japanese trade negotiators for the two countries were working around the clock in Tokyo on a two-way trade pact seen as crucial to a broader trans-Pacific agreement. … Even if Obama and Abe cannot complete a bilateral trade deal before the U.S. president leaves Tokyo on Friday, they are likely to try to project a sense of progress on key issues. The diplomatic challenge for Obama during his week-long, four-nation regional tour will be to convince Asian partners that Washington is serious about its promised strategic ‘pivot’ towards the region” http://reut.rs/1l4x7xy

FIRST LOOK: IS DODD-FRANK BEING UNDERMINED? — Center for Public Integrity in a piece going live this morning: “While [HFSC Chair Jeb] Hensarling’s committee can’t move legislation on its own — the Senate Banking Committee supports Dodd-Frank — the House panel can work its will in other ways. And it has.

“Almost four years after Dodd-Frank became law, community banks face lower capital standards than originally proposed … fewer derivatives traders have to register with regulators and they face lower hurdles in booking trades than they otherwise would have … and big banks may soon have a green light to keep investing in potentially risky securities that regulators tried to limit.” http://bit.ly/PuQGCO

FIRST LOOK II: HOW JOHN HENRY BUILT THE RED SOX — Bloomberg BusinessWeek’s Joshua Green has a cover piece on John Henry and his success at creating a baseball dynasty with the Red Sox (much to M.M.’s chagrin): “As different as he may seem, Henry captures baseball’s current era. A mathematical whiz who made a fortune as a pioneering trader of commodities futures, he’s part of a wave of owners from the financial world that’s sweeping professional sports. In baseball, this includes Tampa Bay Rays owner Stuart Sternberg, a former Goldman Sachs partner, and Milwaukee Brewers owner Mark Attanasio, founder of the investment firm Crescent Capital Group.

“All are keenly attuned to the statistical revolution that has upended the game and compete as vigorously against each other as anyone on Wall Street. Last year, Henry shut down his commodities trading firm to concentrate on his many other endeavors. In addition to the Globe … he and his partners own the English Premier League soccer team Liverpool and a stake in Nascar’s Roush Fenway Racing team. But just as his trading algorithms did, baseball has furnished him with the most spectacular payoffs. Henry provides an especially good lens into how the game is changing and why the Red Sox appear poised for further success.” Look for it online this a.m.

JEB BUSH WILL DECIDE ON POTUS RUN BY NOVEMBER — POLITICO’s Maggie Haberman: “Jeb Bush on Wednesday was the most vocal he’s been about considering a run for the White House in 2016. The Republican told a crowd of about 200 people at a Catholic Charities fundraiser in New York that he is ‘thinking about running for president,’ according to an attendee. … After his answer, the room went wild, and then someone said they hoped he would take the step. ‘Would you call and tell my mom?’ Bush quipped … The former Florida governor said he would make a decision right after this year’s midterm elections.

“Among those on hand was former CNBC host Larry Kudlow, who urged Bush on, the attendee said, and John Catsimatidis, the former Republican candidate for New York City mayor. Bush was praised by Kudlow for his focus on immigration reform and urged not to back down. ‘Why would I back down from it? It’s the right thing to do…we’ve got to be an inclusive party,’ Bush said, according to the attendee. On his support of Common Core educational standards, Bush noted, ‘I’m getting hit from both sides on this one.’” http://politi.co/1k7mfO5

THE OTHER HOT ECON BOOK — Thomas Picketty’s “Capital in the 21st Century” is getting a lot of love, but James Rickards’ “The Death of Money” is also on the NYT bestseller list, making it a veritable golden age for smart books on the current state of the global economy. Rickards emails: “We're not far behind Sheryl Sandberg, Malcolm Gladwell and Jimmy Carter. As my friend Bubba used to say, ‘We're running with the big dogs.’” FT review: http://on.ft.com/1hwI70L NYT best-seller list: http://nyti.ms/1f1gYZP

MORE SCOOP FROM RICKARDS — The author emails from London: “I had breakfast this morning in Mayfair with the Russian Ambassador to the UK, Alexander Yakovenko. We had a dialogue on financial warfare between the U.S. and Russia around Crimea. He said that Russia is actively considering pricing Russian oil exports in roubles and Russia might offer incentives such as a 5% discount for buyers purchasing in roubles rather than dollars. This is easier said than done, but it's fascinating to hear it directly from a senior Russian diplomat as opposed to loose talk on the Internet.”

WHY TPP IS NOT HAPPENING — POLITICO’s Edward-Isaac Dovere: “Obama’s in Asia … pushing a deal that almost none of his allies at home want. On the Hill, most of the pushback is coming from the president’s fellow Democrats, who say it undercuts the economic fairness argument that’s a central focus of his midterm strategy. Despite Obama’s support for the agreement, Senate Majority Leader Harry Reid (D-Nev.) and House Minority Leader Nancy Pelosi have made clear they don’t have much interest in TPP or broader fast-track trade authority passing before November — if then.

“Progressives on Capitol Hill and beyond warn that any deal before Election Day this year would likely depress turnout among the Democratic base, including in the close races that will determine control of the Senate and the make-up of the House. decide who controls the Senate and the House. Yet, the agreement to open up trade with a dozen Asian nations — which would eliminate tariffs and other market barriers — remains the centerpiece of the president’s week-long trip to Asia, pitting him against the populism he’s spending 2014 trying to stoke.” http://bit.ly/1iaMS5i

TOP STORY: OBAMA ADMIN TO DROP NET NEUTRALITY? — WSJ’s Gautham Nagesh: “Regulators are proposing new rules on Internet traffic that would allow broadband providers to charge companies a premium for access to their fastest lanes. The [FCC] … plans to put forth its new rules on Thursday. The proposal marks the FCC's third attempt at enforcing ‘net neutrality’—the concept that all Internet traffic should be treated equally. Developed by FCC Chairman Tom Wheeler, the proposal is an effort to prevent broadband Internet providers such as Comcast, Verizon and Time Warner Cable from blocking or slowing down individual websites served up to the consumer.

“The idea is that consumers should be able to access whatever content they choose, not the content chosen by the broadband provider. But it would also allow providers to give preferential treatment to traffic from some content providers, as long as such arrangements are available on ‘commercially reasonable’ terms for all interested content companies. Whether the terms are commercially reasonable would be decided by the FCC on a case-by-case basis. … Some advocates of an open Internet argue that preferential treatment for some content companies inevitably will result in discriminatory treatment for others” http://on.wsj.com/1l4tAPQ

THIS MORNING ON POLITICO PRO FINANCIAL SERVICES – Jon Prior on CFPB’s plans for mortgage closings [ http://politico.pro/1mFXqfV] … To learn more about Pro's subscriber-only coverage — and to get Morning Money every day before 6 a.m. — please contact Pro Services at (703) 341-4600 or info@politicopro.com.

GOOD THURSDAY MORNING — Michael Pineda got tossed from last night’s Sox-Yanks game for the lame reason that he likes to wear a special brand of pine tar aftershave on his neck. Give the guy a break! He likes to smell fresh on the mound. http://es.pn/1rnhJOE

DRIVING THE DAY — President Obama continues his state visit to Japan … Treasury Secretary Jack Lew visits Detroit and will hold a meeting with foundation leaders … Ex-Im bank kicks off its annual conference in DC (more on this below) … Initial jobless claims at 8:30 a.m. expected to rise to 313K from 304K … Durable goods orders at 8:30 a.m. expected to rise 2.0%, 0.6% ex-transportation …

EX-IM PREVIEW — Ex-Im Bank Chairman Fred Hochberg plans to open the bank’s annual conference by making the case for reauthorization saying that “reauthorizing the Bank never used to be a political issue — and it shouldn't be today. Supporting American job growth shouldn’t be controversial.” … Hochberg will warn that the U.S. "can’t let rigid ideologies stand in the way of American jobs and American leadership.” … Secretary of State John Kerry will also address the conference. Other speakers include Wells Fargo CEO John Stumpf and Tesla and SpaceX CEO Elon Musk

WORK AT POLITICO! — Hot job opening on the POLITICO financial services team. It’s a great opportunity for an energetic and aggressive reporter to cover the intersection of Wall Street and Washington — the political and policy debates surrounding the oversight of financial markets. The ideal candidate will have policy expertise and a passion for politics. If you're interested or have questions, drop us a note. We're interested in your ideas for what are the best and most interesting ways to cover the beat. Contact: Dave Clarke (dclarke@politico.com). http://politi.co/1igBxlm

RATINGS AGENCIES BOOMING AGAIN — WSJ’s Timothy W. Martin: “Six years after getting a failing grade for their role in the financial crisis, credit-rating firms are at the top of the class. Riding a global bond boom, the two biggest U.S. firms, Standard & Poor's Ratings Services and Moody's Investors Service … this month are expected to post record first-quarter profits. Fitch Ratings said in its annual filing this month that 2013 was ‘one of its best years ever.’ … Beyond the spike in bond deals, the resurgence is due largely to the absence of major changes to the industry since the crisis: The business model, in which debt issuers pay for ratings, remains in place; regulations proposed years ago are yet to be implemented; and new competitors have gotten little more than a toehold” http://on.wsj.com/1hlXltY

APPLE SURPRISES WITH iPHONE SALES — FT’s Tim Bradshaw: “Apple recovered its capacity for surprise with Wednesday’s earnings, as iPhone sales delighted Wall Street after a long spell of slower growth. Driven by China, an unexpected 17 per cent jump in iPhone unit sales helped Apple to beat revenue forecasts for the first three months of the year, driving an 8 per cent leap in its shares. Wall Street cheered an overall 5 per cent rise in sales to $45.6bn … Alongside its earnings, Apple topped up its capital return programme by more than $30bn, increasing its dividend by 8 per cent and boosting share buybacks to redistribute a planned $130bn before the end of 2015. Apple said it expected to return to the debt markets this year to help fund the buybacks, including for the first time looking outside the US to raise funds” http://on.ft.com/1jR2QPX

FACEBOOK EARNINGS NEARLY TRIPLE — AP: “Facebook’s earnings nearly tripled and revenue grew sharply in the first quarter, surpassing Wall Street’s expectations thanks to an 82 percent increase in advertising revenue. It was the fourth quarter in a row that Facebook beat forecasts as it continues to barrel ahead in mobile advertising at a time when nearly 80 percent of its users are accessing it on smartphones and other portable gadgets. The world’s biggest online social network said … it earned $642 million, or 25 cents per share, in the January-March quarter, up from $219 million, or 9 cents per share, in the same period a year ago.

“Adjusted earnings, which exclude stock compensation expenses and other costs, were $885 million, or 34 cents per share, in the latest quarter. Facebook’s revenue was $2.5 billion, up 71 percent from $1.46 billion in the same period a year ago. Analysts, on average, were expecting adjusted earnings of 24 cents per share on revenue of $2.36 billion, according to a poll by FactSet. Shares of Menlo Park, Calif.-based Facebook climbed $2.34, or 3.8 percent, to $63.71 in extended trading after the results came out." http://wapo.st/1hqrFiL

ALSO FOR YOUR RADAR —

NEW HOME SALES TANK — WSJ’s Sarah Portlock and Kris Hudson: “A surge in prices helped drive down sales of newly built homes in March, the latest indication that the housing market is struggling to regain traction. Sales of new single-family homes fell 14.5% from February to a seasonally adjusted annual rate of 384,000 … That was the lowest annual rate since last July, though the pace for January and February was revised higher. A harsh winter had shut construction sites and softened the housing market in recent months. But the latest data raise the prospect that new-home sales are being hampered by more than rough weather” http://on.wsj.com/1f5IqWi

PRIVATE PLACEMENTS UNDER THE MICROSCOPE — Reuters’ Emily Flitter: “Private placements are a form of fund-raising whereby a company issues securities — shares, bonds, promissory notes and the like — to relatively few investors through private sales by broker-dealers, rather than through a general offering on a public exchange. Under U.S. law, these issues are exempted from the extensive financial reporting requirements that govern public offerings. ... The set-up constitutes what many see as a fundamental conflict of interest: Companies that raise money through private placements … are paying due diligence firms to review their deals so that broker-dealers will sell them.” http://reut.rs/QzEiCG

FIRST LOOK: FINANCE OPTIMISM INDEX DROPS — Per release going out this a.m.: “The Consumer Bankers Association/AOL Inc. monthly Finance Optimism Index dropped in March 2014 for the second month in a row to -6.2, a decline of 3.6 in consumer’s optimism about their personal finances. With the impending Federal Income Tax filing deadline in April, consumers were likely taking stock of their financial situation and potentially facing a looming tax bill. This follows sluggish job growth and swiftly rising food prices, meaning many Americans are feeling the squeeze on their budgets.” http://bit.ly/1mG4t8m

*** A message from Morgan Stanley: Storage makes renewable energy available when it’s needed the most. Given the U.S. electric grid’s lack of storage capacity, conventional power plants, including gas-fired ones, have remained utilities’ most reliable source of electricity. That could be about to change. Morgan Stanley analysts argue that the price of both solar and wind energy, as well as new storage units, have reached a point where renewable energy can finally become a dependable, rather than an unpredictable, source of energy. According to the report, the demand for storage is expected to grow from a less than $300 million a year market to as much as $4 billion in the next two to three years. More affordable battery storage units could enable the growth of renewables or defer costly transmission and distribution projects, and also could lead to significant utility bill savings for solar customers. Read more from Morgan Stanley. ***

Authors:

About The Author

Ben White is POLITICO Pro's chief economic correspondent and author of the “Morning Money” column covering the nexus of finance and public policy.

Prior to joining POLITICO in the fall of 2009, Mr. White served as a Wall Street reporter for the New York Times, where he shared a Society of Business Editors and Writers award for breaking news coverage of the financial crisis.

From 2005 to 2007, White was Wall Street correspondent and U.S. Banking Editor at the Financial Times.

White worked at the Washington Post for nine years before joining the FT. He served as national political researcher and research assistant to columnist David S. Broder and later as Wall Street correspondent.

White, a 1994 graduate of Kenyon College, has two sons and lives in New York City.